ALPHA PRO TECH LTD Q2 FY26 Results

During the second quarter of 2026, we again outperformed the market, as our building supply segment sales were up by 5.5% from the prior year quarter. The core building products sales (housewrap and synthetic roof underlayment) were up 2.2% from the prior year quarter, with an increase in both synthetic roof underlayment and housewrap sales, combined with a decrease in rebates in the second quarter of 2026. With that said, the housing market continued to show weakness in the second quarter of 2026, as single-family housing starts declined by 4.2% compared to the corresponding period of 2025. Single-family housing starts in the U.S. remained constrained by mortgage rates, increased land, labor and construction costs, affordability pressures, macroeconomic uncertainty, and geopolitical volatility, which has led builders to moderate new construction activity. This decline in the second quarter of 2026 represents an improvement from the decline of 6.5% in the first quarter of 2026. In addition, the Asphalt Roofing Manufacturers Association (“ARMA”) reported a 10.0% decline in industry shipments compared to the second quarter of 2025. The building industry outlook for the remainer of 2026 reflects a soft but generally stable market, rather than a meaningful rebound. A modest increase in single-family housing starts is expected in 2027, assuming economic and financing conditions improve. Management remains focused on developing and producing industry-leading products and anticipates growth in the Building Supply segment; however, uncertainty related to the factors described above could adversely impact results. Sales of disposable protective garments comprised 93.0% of the segment sales, increasing by $1.5 million or 29.0% in the second quarter of 2026 compared to the same period of 2025. The sales increase was primarily due to improved sales to our largest international channel partner, as well as national and regional distributors. A considerable portion of the increase was attributable to higher selling prices, primarily driven by the impact of U.S. tariffs. Sales of our face mask and face shield products in the second quarter of 2026, which comprise the remaining 7.0% of the segment sales, were down by $64,000 compared to the same period of 2025.

As of June 30, 2026, we had $1.3 million available for additional stock purchases under our stock repurchase program. As of June 30, 2026, the Company had repurchased a total of 21.9 million shares of common stock at a cost of approximately $58.2 million through our repurchase program which commenced in 1999. We retire all stock upon repurchase and future repurchases are expected to be funded from cash on hand and cash flows from operating activities.